see how an IUL performs - both during accumulation, and distribution assuming the tax free loan status and continual crediting of the loan amountUm .... forgot about this. Plain vanilla simple method is final value $29,800.

Need to figure accumulation of running balance minus outstanding loan minus 6% interest. Let's assume we don't reduce the value by the draws, but keep track of the draw amount and the interest owed in a side account.We'll let it grow, then at the end offset by subtracting the balance of this side account.

So play a game with the spreadsheet. Accumulation phase as before, to 1/1/2003, but then set withdrawal of $0 (this stops the deposits). See what final value is reported, and then subtract out the total amount of the side account.

SWAG on the loan interest. Avg balance of $100,850 (half of the total draw) at 6% per year = $6051/yr. Over 10 years that's $60,510.

Oh, duh!! No need to SWAG -- excel is good at this kind of thing.Ending balance of loan side account at 6% interest, computed monthly is $272,000. ($270,600 if computed annually.)

Final net value: $286,500 - $272,000 = $14,500.

Same ballpark as the plain Jane method, so all the fancy footwork with loans, etc. is just fancy-dancing with minimal real-world effect.

----------------------------------------CC:Also, we're not using a "single investment" of $1,000 but an agreed ongoing investment of X.CC, what he did was a quick & dirty back-of-envelope smell test. Engineers & physicists do this all the time.All you are trying to do is to see what ballpark the numbers are in. "Smell test" is like sniffing that lunchmeat in the refigerator --- you're not trying to get an exact freshness level -- you are just trying to see if it smells bad.

The value of this technique is that it is simple -- so simple that any methodology errors will be clearly obvious -- but that it will still give you a decent approximation to the results that have all the complexity. If the back-of-envelope number is way off from what you need it to be -- it smells and you know your idea is garbage, yo don't need to waste any more time & effort to be more exact.

Like he said, you can do this in 5 minutes. It's so simple that it would take as much time find it again after you've saved it as it would to just re-do it from scratch.